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ITV Report

15 July 2012 at 6:57pm

Milk supply may be cut, if price cut is not scrapped

Farmers say dairy herds like these are under threat, from proposed price cuts Photo: ITV News

A group of dairy farmers say they may cut the supply of milk, if proposed price cuts go ahead. Farmers for Action say they are making financial loss with each litre they produce, and that the situation has to change.

Milk processors want to cut the amount they pay farmers by up to 2 pence a litre. The changes which are expected to come into force in August will mean it's the second price cut for milk this year.

Farmers say that it costs over 30 pence to produce a litre of milk, but that they're only being paid 25p.

David Handley has a farm near Usk, and fears he may lose his livelihood and business if the cuts go ahead. He's part of a group called Farmers for Action, who say they'll stop the supply of milk to save the industry.

The processors blame the price cuts on the collapse in the value of cream and their rising costs.